Google “Do I need a business plan?” and you’ll get a whole lot of “yes” – 20 Reasons Why You Need a Business Plan, 9 Reasons Why You Need a Business Plan, 15 Reasons Why You Need a Business Plan … and so on.
So, everyone seems to agree that you need a business plan (though they don’t seem to agree on how many reasons you need it).
It would be arrogant of me to disagree with the first page of Google. So here goes…
As a solopreneur you don’t need a business plan, in fact you don’t want a business plan. It will probably hurt you.
But wait… isn’t failing to plan just planning to fail? Yes, it is.
I’m not saying you don’t need a plan. You just don’t want a traditional BUSINESS plan!
The reason people use business plans is that it keeps the company focused on executing. when multiple people are involved in a startup, they can end up pulling in different directions, hurting progress. A business plan can help keep the team all working toward the same goals the same way.
Additionally, business plans are often required to obtain financing of some kind. As such, they are written for outside consumption.
But here’s the thing – you are or are planning to become – a solopreneur. So, unless you have multiple personalities, you won’t need a document to know what you are thinking and doing in the business.
It’s also unlikely you are seeking financing at this point.
One problem with a business plan for solopreneurs starting out is that it’s a lot of work. A typical business plan has some or all of the following:
- Executive summary
- Company description
- Market analysis
- Organization and management
- Service or product line
- Marketing and sales
- Funding request
- Financial projections
There are a couple of additional problems with traditional business plans:
- It’s designed to be read by other people – not the solopreneur. This is the wrong perspective for a one-person business and it means that actually writing the plan is more time consuming than it needs to be, Additionally, we tend to focus on the positives when describing our business others. Rose-colored glasses aren't the best choice for a document that is going to guide your one-person business.
- Once done, it’s often treated as cast in stone. This is because creating one can take a lot of work. Because of that, people are then reluctant to revise it as they go. But it’s quite likely you will need to revise it as your business meets the real world.
The last problem is the one that can really hurt you. Your plan is unlikely to remain intact after you launch. Things you thought -assumptions you made - will turn out to be wrong. Then the plan needs to change. Yet business plans are used to keep people doing what they are “supposed” to be doing. There is an inherent “the plan is right” perspective baked into the business plan. And yet it probably isn’t.
Yet you are better off with a traditional business plan than no plan. Winging it is not something I recommend.
I developed a process designed especially for solopreneurs that is made to avoid these pitfalls. It's called the Solopreneur Success Cycle and I recommend that you check it out.
It’s not that there’s not a lot to this process as well, but it is less formal and designed with a focus on the solopreneur and not the outside world. It also has a built-in process for changing the business as needed because, as we discussed, it is highly unlikely that your initial plan will remain intact.
Instead of a formal document prepared for investors and lenders, you’ll have a bunch of ideas for how to start up your business that are made by you and for you to run your business. For most solopreneurs, this is an easier approach that is still rigorous and even more helpful. And rethinking the business is built into the process so you are continuously improving.